Global equity market turmoil continued when markets opened the week’s trading. Asian equity markets suffered, in particular, with Hong Kong losing more than 13% and Japan and China losing over 7%. The global trade war is restricted mainly to China at the moment, with most other stakeholders in Europe and Asian seeking negotiation and compromise. China immediately announced a retaliation of 34% tariffs on US goods and services. This was met with an immediate response from Trump, who threatened a further increase of 50%, on all Chinese goods and services. Many Asian Tigers are looking to negotiate with the US and cut all tariffs, which is the ultimate solution to this trade crises. Oil fell below USD$60/barrel, while gold also dropped sharply, trading below USD$3,000/oz. European markets plunged overnight, all crashing more than 4%, but the US share markets appears to be stabilising. The USD remains stable, with the EUR trading around 1.0900, while the GBP dipped to 1.2760.Commodity currencies also appeared to be consolidating recent losses, with the AUD trading below 0.6000, while the NZD trades around 0.5550. NZ and Australia received the lowest tariff impost of 10%, which may be negotiated away, with any diplomatic prowess. This is a huge week of volatility, but the moves towards compromise will stabilise markets.
